“Commerce In India is Bright” – Nirmala Sitaraman

In a rare, exclusive interview with JUST IN PRINT,equanimous, cogent, patient yet strategic, calling-spade-a-spade, inherently pragmatic Union Commerce and Industry Minister Nirmala Sitaraman answers questions on the country’s current commerce, industry, their would-be in the coming days.

Q: Starting the interview with the most immediately pressing factor in Commerce : FDI. Where is India in FDI currently?

A: Commerce in India is bright. FDI has shot up to 37% after launch of Make in India. Foreign Direct Investment (FDI) into the country has increased 37 per cent after the launch of ‘Make in India’ programme till February this year. In the 17-month period (October 2014-February 2016) up to February after the launch of ‘Make in India’, FDI inflows have steadily increased by 37 per cent

The overseas inflows grew 29 per cent during the period compared to the 15-month period prior to the launch. The ‘Make in India’ initiative was launched on September 25, 2014 with an aim to make the country a global manufacturing hub. In 2015 the government has received as many as 204 FDI proposals, worth $39.32 billion.

In 2016, (till April 22), 64 proposals have been received.Top ten states that have implemented industrial entrepreneurs memoranda(IEMs) during January 2015 to March this year include Maharashtra (82 worth Rs 53,438 crore), Gujarat (117 worth Rs 8,474 crore) and Andhra Pradesh (67 worth Rs 5,560 crore).Services attracted the most ($5.95 billion) during the first eleven months period of 2015-16. It was followed by computer software and hardware ($5.83 billion), trading ($3.67 billion) and automobile ($2.44 billion).

Q: Your comments on US’ concern on India’s issuance of licenses ?

A: We’re fully aware of it. The US has raised concerns over issuance of the licence by India. New Delhi has so far issued only one such licence. US’ concern thus is unfounded. …During the past three years, two applications for compulsory licensing (CL) under section 92 of the Patent Act 1970 have been received by the department of industrial policy and promotion (DIPP).Under the Indian Patents Act, a CL can be issued for a drug if the medicine is deemed unfordable by the government and grants permission to qualified generic drug makers to manufacture it.

In March 2012, Hyderabad-based Natco Pharma Ltd was allowed to manufacture and sell cancer-treatment drug Nexavar (sorafenib) at a price over 30 times lower than charged by patent-holder Bayer Corp., under CL.

As per the World Trade Organization (WTO) agreement, a CL can be invoked by a national government allowing a company to produce a patented product without the consent of the patent owner in public interest.

Q : Is it true that India Inc is reluctant to adapt to new practices and put off new adoptions?

A: Truly, India Inc doesn’t want to adopt new changes.Amidst growing concerns about robots and automation replacing human labour in the next wave of industrial revolution, the industry may restrict the use of robots to high-end technology. India can’t afford to leapfrog to robotics as millions of aspiring youngsters are coming out of the universities seeking employment.

New industrial revolution would in fact create demand for more specialised skill sets and India needs to come out with a long-term skill policy to meet the future demand. India need to embrace the ‘fourth industrial revolution’ as it will ensure a level playing field between developing and developed countries. The industry should not forget the demographic dividend the country enjoys.

Q: How far India is affected by Global Slow Down?

A: Yes, India is getting affected with the global slowdown. But this initiative will give economy a push as we aim to increase exports post the event.

The global business community has responded enthusiastically to Indian economy’s revivalist fervour and the Make in India week will further showcase the nation’s accomplishments in manufacturing and position India as an investment, innovation and manufacturing hub. FDI in the world is falling (-16%); India is the only country where foreign investments are growing. The government has incessantly pushed policy measures to boost manufacturing and today, FDI in India is growing at 38% while globally there’s a sharp fall.

The Indian economy is stable as compared to other countries despite a slowdown, and other countries are showing interest in India for partnerships. Moreover, the ease of doing business has helped show the potential in India. It has also aided competition among states which is generating new interest among investors for India. States have a significant role in building and sustaining a manufacturing revolution and in the spirit of co-operative as well as competitive federalism, they will be the drivers of development and the Centre will play a catalytic role.

Q: Government’s views on SEZ?

A: The government is considering several measures, such as offering incentives for small exporters and a package to revive Special Economic Zones (SEZs), to help reverse the trend of a prolonged contraction in merchandise exports since December 2014.

Labour-intensive export sectors and organic food producers will get concessions and a package is on the anvil for SEZs so that they can utilize large tracts of unused land available with them.

Also being considered are steps such as categorising the entire export credit given by all lenders separately under priority sector lending without riders, ensuring better coordination with Indian missions overseas, as well as relaxing norms for the Export Import Bank of India (Exim Bank) and Export Credit Guarantee Corporation of India (ECGC) to give them greater operational flexibility.

Setting up of three dedicated zones for manufacture of Active Pharmaceutical Ingredients (API or drug raw materials) and other pharmaceutical items, incentives for the bio-tech industry especially for skill development, sops for manufacture and export of electronic items, besides targeted measures to address the problems of small importers of steel items, exporters in the gems & jewellery and sea food sectors, are the other steps being considered.

These proposals will be taken up soon with other Ministries and regulatory authorities, Commerce & Industry Minister Nirmala Sitharaman said after the Board of Trade (BOT) meeting. The 72-meber Board is a government-industry panel looking into measures to boost exports. Indian exports have declined from $314 billion in FY’14 to $310 billion in FY’15. Exports in FY’16 are expected to shrink further to nearly $260 billion. The Prime Minister is keen that the government is constantly engaged with the export sector to ensure that their problems are sorted out expeditiously. To ensure consistent high rates of economic growth, possibly closer to 10 per cent, we need exports sector also do to well. We will hold interactions with Indian High Commissions and Embassies along with their commercial and economic wings to make them more vibrant and understand requirements of exporters.”

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